LED sector grows faster than anticipated: expert

KNOCK ON EFFECTS:The local LED market is to see a rebound as demand increases due to an improving world economy and street light replacement at home

Staff writer, with CNA

The global light-emitting diode (LED) industry is expected to ride the wave of an uptrend in demand, in particular for lighting applications, as the world’s economy rebounds, a local market researcher said on Friday.

Since the beginning of this year, sales of LED lighting have expanded at a quicker-than-expected pace, the industry experts said.

As the peak season for the LED industry is to arrive in the second quarter of this year, momentum is expected to continue, leaving behind the slow year last year, which was partly caused by the financial turmoil in the eurozone, experts said.

According to LEDinside, a research division of market information advisory firm TrendForce Corp (集邦科技), production value of the global LED industry is expected to rise 12 percent from a year earlier to NT$367 billion (US$12.4 billion).

At the end of last year, Europe imposed a ban on imports of incandescent bulbs, which has boosted demand for LED bulbs in some European countries, market sources said.

Meanwhile, Taiwan has started efforts to replace incandescent street lights with LEDs. Several local governments have launched bids for street light replacement projects, which are expected to give a boost to local LED firms’ sales, they said.

Epistar Corp (晶電), one of the nation’s leading LED chipmakers, said it expects sales of global LED bulbs to grow sharply to 300 million this year, up from about the 100 million it recorded last year.

With production costs on the decline, more affordable LED bulbs are expected to stir up buying interest, the company said.

Everlight Electronics Co (億光), one for the major LED component suppliers in Taiwan, has high hopes for strong demand of LED lighting this year, expecting that this will account for 20 percent of the company’s total revenues, up from about 10 percent a year earlier.

Unity Opto Technology Co (東貝光電), another local LED bulb maker, said it has gained orders to supply more than 7 million bulbs worth US$1 billion so far this quarter, while LED lighting manufacturer Epileds Technologies Inc (光鈜科技) said its production capacity utilization rate currently stands at 80 percent and is expected to rise to 100 percent later this month.

Amid optimism on a business rebound, LED stocks on the Taiwan Stock Exchange have posted significant gains in recent sessions, while the broader market has moved in ranged trade on thin turnover.

Unity Opto Technology shares gained 5.36 percent to close at NT$29.50, while shares of Everlight increased by 3.55 percent to end at NT$43.70 and shares of Epistar closed up 3.13 percent at NT$59.40 on Friday.